Never Buy Food on Credit

One day when I was 16 years old my father gave me his Shell gas card and asked me to fill up his car. Who remembers being a teenager and loving any chance you got to drive the car? Woo hoo!

The gas station was about two miles from our house and this was back in the days where you didn’t have to pay before you fueled up, and you went inside to pay the cashier afterwards. The Shell station had a convenience store and when I finished gassing up the car, I went inside to pay and grabbed a box of Old Dutch chips off the shelf. I don’t remember how much it cost to fill up the car, and I don’t recall which flavor of chips I bought, but it probably was my favorite sour cream and onion. The only thing I remember is they cost 69¢.

Image courtesy Old Dutch

I don’t think my father was annoyed about me buying chips – he liked to eat them too.

He was annoyed because I put them on the Shell credit card.

“Never buy food on credit,” he told me. That was over 40 years ago and that advice has stayed with me my entire life.

Pay Cash for Food

I always pay cash when I buy groceries or eat out at a restaurant.

However, when debit cards came along, I started carrying that card instead of cash. I still consider the debit card as cash. After all the money comes directly out of my bank account when I use it and doesn’t cost me any fees. All I’m doing is saving myself a trip to the bank or the ATM to withdraw cash before shopping.

The only time I break the “never buy food on credit” rule is when I’m traveling in another country. I try to conserve my foreign cash and use the credit card as often as possible.

That being said, in my credit union I have a vacation fund. I’m not spending more money on the credit card than I have in that account. When I get home and the credit card bill comes in, I pay it in full from the vacation account.

This “never buy food on credit” rule has probably saved me from going into credit card debt. Or having too much debt during times when I couldn’t pay the credit card off in full when the bill came in.

If you’re carrying a balance on your credit card and paying interest on it, that food you bought just became a whole lot more expensive. Anywhere from 25% to double the cost, depending on how long it takes you to pay that credit card off.

That’s not a very good deal.

Is it ever acceptable to buy food on credit?

Years ago I worked with a lady who said she always paid for groceries with a credit card for the air miles. I probably mentioned something about my “never buy food on credit” rule that I lived by, and she added they paid the bill off in full when it came in. Whether or not that’s true, I do remember she was very responsible with money. She started working as a waitress as a teenager, saved her money, and bought her first home in her early 20s. She’d recently married and her husband made a good income and she had a lot of money saved for retirement and was about 40 at the time.

If you’re in a good place financially, use your credit card to get air miles, and pay off in full each month, that’s your decision.

The reality is most people can’t pay off their credit card in full each month, so why add on unnecessary debt?

Can you manage your credit card balance?

Many people have credit card debt. Many people struggle to pay bills. Not everyone has a husband or wife who can contribute to household expenses. A lot of people have to turn to their credit cards when they’re unemployed, have medical expenses, and other emergencies. These people are probably not out of control spenders. They’re just trying to survive.

If you’re using your credit card to buy something big, say a bedroom set because you probably don’t carry hundreds of dollars in cash around with you, then you still have your bedroom set that you’re using daily. If you’re using your credit card to buy food, once you’ve eaten the food, it’s gone. You’ve got nothing to show for when the credit card bill comes in.

Air miles, points, and rewards

Many credit cards offer a reward system to their clients. Get enough points and you can cash them in for air flights, hotels, gift cards, and all kinds of merchandise.

The travel aspect does interest me, but I’m not willing to run up the credit card to get points that I can redeem for stuff. One of my credit cards I’ve cashed in a couple of times to get a $25 gift card at a restaurant. It probably took years to add up those points!

Recently I phoned in to one of my credit cards, I believe I’d received a voice mail that suggested there’d been a security alert. It was a scammer, as I found out when I phoned in to discover no one at Visa had called me. The clerk noticed I don’t use my credit card very much, about $700 in the past year and it was costing me $20 a year, to have a card with a lower interest, but I was paying off the card in full whenever I used it. She suggested I get a card with no annual fee, though the interest rate would be higher, and talked about the benefits on two of their cards. One of them was a Visa where I could earn double points buying groceries. Not that one, I said. I never buy food on credit.

What do you regret buying?

Look at your credit card statement for the last month.

Or if you’re actively paying off your debt and not incurring any new debt – Yay you! – look at the most recent statement where you had multiple charges. What do you most regret using your credit card to buy?

My credit card bill just came in for the month of December. I have three charges. Two are charities I donated to and the third charge is to the company that hosts my website – domain renewal and privacy protection. Total bill comes to just under $200. I look at those three charges and there is nothing I regret. The bill is manageable for me to pay entirely before the due date.

Have you decided what you regret buying most?

The answer for most people is eating out. It would have been cheaper to stay at home. They wouldn’t have racked up more debt on the credit card.

If you have $20 in your wallet and need to buy groceries to last a week, first of all, look around your pantry and see what canned goods, dry goods, and frozen food you have that can be used for meal preparation. Maybe you can even put off grocery shopping for a few days and eat what you have on hand! Here are some suggestions for low cost groceries to tide you over:

Eggs – this is a great, low cost meal option. Depending on where you live a dozen eggs might cost $2, and probably no more than $4 if you live in a high cost area. I recommend hard boiling them as it’ll seem like you’re eating more. If you have an Instant Pot, see my post on making hard boiled eggs in the Instant Pot.

Beans – canned beans can usually be found for $1 or less, or get more for your money and buy dry beans in the bulk aisle, soak overnight, and cook at home. The bulk bins usually have a scale, so weigh before you take them to the cash register, to make sure you’re under budget. Beans are filling and a good source of protein, and you can make beans and rice.

Rice – you can buy rice in the bulk aisle and get as much as you need, using the scale to match your budget. However, don’t discount the international section of the grocery store or small produce/grocery stores that stock a lot of Asian groceries. Sometimes you can buy several pounds of rice for less than $5.

Oats – seeing as how you’re in the bulk aisle, buy oats and cook them for breakfast with brown sugar, cinnamon, or fruit if you have any.

Skim milk powder – if you don’t have milk at home, and can’t afford to buy a jug, purchase skim milk powder while you’re in the bulk section.

Potatoes – another filling food item. You can either buy potatoes singularly, or look for any specials in a bag. Sometimes you can buy a 10 pound bag of potatoes for $2 or $3. I find small produce or ethnic stores often have better prices than big grocery chains.

Bananas – they fill you up and are usually not too expensive. You can weigh them in the produce section before you buy and keep it under $2.

Frozen fruit and vegetables – as a single I tend to buy a lot of frozen produce because it beats buying fresh produce that goes bad before I can eat it. Cruise past your frozen section and look for items on sale.

Other options to get away from using a credit card to buy food

If you’re using a credit card to buy groceries because there’s nothing to eat in the kitchen, that’s a very sad thing.

If you’re very desperate for food, there are food banks and soup kitchens in most communities, and they’re not just there to help the homeless. They’re there to help people through bad times.

You can use coupons.

Keep an eye on things you can buy in warehouse type sizes when the price is low enough. Costco’s not the only place that offers these oversized products for sale! Keep an eye on bags of oranges, apples, pears, carrots and potatoes. Don’t buy more than you can eat. If you can’t eat the bag before the food turns rotten, then leave them on the shelf.

Learn how to bake – bread, muffins, cookies are inexpensive to make and can be frozen.

Your take?

What do you think about buying groceries and eating meals out and paying with your credit card?